Cohabiting couples show caution with their finances

Brits are showing caution with their finances when they decide to move in with a new partner, research from online bank first direct reveals. The findings show that for the majority, financial commitment is not on the agenda with couples keeping their distance in their money and property arrangements.

The survey of 1924 UK adults reveals that amongst those cohabiting, or those who have previously lived as a couple, the majority did not join their finances with their partner. Around 58% did not set up a joint account when they moved in, while a further 21% only set up a joint account for bills, keeping their existing separate current account for their own spending. This means that just 20% decided to unify their money and control all their finances from a joint account.

This latest round of research also found that many couples did not fully commit in their property arrangements when moving in together. Just 30% of couples rented with both names on the lease, and only 18% bought together with both names on the mortgage, leaving the majority who lived in a property rented or bought with only one partner's name registered.

Additionally, less than a third (28%) of couples paid the deposit on their first property jointly through savings and 14% paid it together but with one partner paying more than the other. Thirty six percent say that one partner put down the whole deposit. Despite this, 97% of people did not sign a prenuptial agreement.

Richard Tolchard, Senior Mortgage Product Manager at first direct said: "Taking the step of buying a home together is an exciting one, but the head needs to keep the heart in check. This is particularly wise where one party is contributing more than the other to the initial deposit or ongoing household finances.

"While homeowners are naturally confident things will work out and are keen to minimise costs when buying a home, getting independent legal advice on what would happen in the worst case scenario is always sensible if you're not married or in a civil partnership."